Broad form insurance might be right for you if you want to lower your car insurance costs, insure yourself, or drive an older car. This article talks about what broad form insurance is, when it’s a good idea to have it, and some other common types of insurance you can pick from. We’ll also suggest some of the best auto insurance carriers to consider for a new policy. Key Takeaways.
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Broad form insurance is one of the most basic and affordable types of car insurance available. While its low cost may be appealing, broad form coverage only provides liability protection for one driver. Understanding what broad form insurance includes, who it’s best for, and how much it costs can help you decide if it’s the right choice for your situation.
What is Broad Form Car Insurance?
Broad form insurance gets its name from the broad range of perils covered under standard property insurance policies. Auto broad form coverage provides liability protection but omits many key coverages.
Here’s a quick look at what broad form car insurance includes:
- Bodily injury liability – covers injuries to others you cause in an at-fault accident
- Property damage liability – covers damage to others’ property you cause in an at-fault accident
- Uninsured motorist coverage – covers injuries from an uninsured driver (in some states)
That’s it! Broad form policies only cover liability for the one named insured driver. Collision, comprehensive, medical payments, and coverage for additional drivers are not included.
Broad form insurance meets the minimum requirements in just 11 states, Most states require more substantial liability limits and additional types of coverage
What’s Not Covered by Broad Form Car Insurance?
A broad form auto policy leaves significant gaps in coverage. Here are some key exclusions:
- Collision – Damage to your car from an accident, regardless of fault
- Comprehensive – Damage to your car from theft, vandalism, weather, animals, fire, and more
- Medical payments – Your medical bills after an accident
- Uninsured motorist – Injuries from an uninsured driver (in some states)
- Underinsured motorist – Injuries exceeding limits of at-fault driver
- Others driving your car – Damage or injuries caused by anyone besides the named insured
Without these coverages, you’re fully responsible for repairs, injuries, and other losses
When Might Broad Form Coverage Work?
Given its minimal protection, broad form insurance is rarely a smart choice. Here are a few instances when it could suffice:
- You have ample savings and assets to cover accident costs out-of-pocket.
- Your car has very low value, so you can easily replace it if damaged.
- You only drive rarely or borrow others’ cars occasionally.
- You never carry passengers who could be injured.
For most drivers, the risks of broad form insurance outweigh the savings. It’s best to carry more robust coverage to safeguard your finances.
How Much Does Broad Form Car Insurance Cost?
Broad form insurance premiums are lower than standard policies, but the coverage differs greatly. Here are average full coverage and minimum liability premiums in select states:
<table>
<thead>
<tr>
<th>State</th>
<th>Full Coverage</th>
<th>State Minimum</th>
</tr>
</thead>
<tbody>
<tr>
<td>Florida</td>
<td>$2,162</td>
<td>$828</td>
</tr>
<tr>
<td>California</td>
<td>$2,125</td>
<td>$606</td>
</tr>
<tr>
<td>New York</td>
<td>$2,062</td>
<td>$867</td>
</tr>
<tr>
<td>Rhode Island</td>
<td>$2,040</td>
<td>$738</td>
</tr>
</tbody>
</table>
As you can see, state minimum coverage that meets requirements is significantly cheaper than a full coverage policy. Premiums for broad form insurance will be even lower.
For example, a full coverage policy in Colorado averages $1,804 annually, while state minimum coverage averages just $437. Broad form would likely be less than $400 per year. However, the protection differs enormously.
Who Should Consider Broad Form Car Insurance?
In limited cases, broad form insurance may suffice if you:
- Have substantial disposable income and emergency savings
- Drive an older, low value vehicle
- Only drive infrequently
- Never have passengers
- Have coverage under a partner’s policy
However, for most drivers broad form insurance is far too risky. The lack of collision, comprehensive, uninsured motorist, and medical payments coverage can leave you in financial ruin after an accident.
Alternatives to Broad Form Insurance
Rather than slimming down to broad form, consider these ways to reduce your premiums while keeping solid protection:
- Shop around – Compare quotes from insurers like Geico, State Farm, and Allstate
- Ask about discounts – You may qualify for reduced rates for good driving, low mileage, bundling policies, and more
- Raise deductibles – Pay more out-of-pocket per claim in exchange for lower premiums
- Limit collision/comprehensive coverage – Drop these optional coverages for an older car
Key Takeaways
- Broad form auto insurance only covers liability for the named insured driver
- It lacks collision, comprehensive, medical payments and uninsured motorist protections
- Broad form policies meet minimum requirements in just 11 states
- Premiums are cheaper but provide far less coverage
- It’s only advisable for drivers with ample savings and few risks
- Most motorists need fuller coverage to safeguard their finances
What Does Broad Form Insurance Cover?
It meets your state’s minimum liability car insurance requirements. There are three aspects of this, such as:
- Body injury liability per person: This covers other drivers’ and passengers’ medical bills and lost wages after an accident you caused.
- Liability for bodily harm per accident: This is the most your insurance company will pay for other people’s injuries after an accident.
- Liability for property damage per accident: This covers damage to other cars or personal property like fences and homes after an accident. It can also cover your court costs.
Some companies will also let you add uninsured motorist coverage and personal injury protection to your broad form car insurance. These can help lower your out-of-pocket costs by paying for your medical bills and fixing the damage to your car.
Broad Form Auto Insurance vs. Standard Car Insurance
Standard car insurance offers more protection than just liability. It doesn’t matter who was at fault; your collision policy will pay to fix or replace your car if it gets damaged in an accident.
And if your car is damaged by wind, theft, vandalism, fire, floods, or tornadoes, comprehensive coverage will pay for the repairs directly from your insurance company. If you lease or finance your car, you need to have both collision and comprehensive coverage. Lenders require both policies with a lower deductible.
Full coverage also pays for medical expenses for you and your passengers. The coverage varies based on your state. If you live in a no-fault state, you’ll have access to PIP. In at-fault states, you have access to medical payments coverage. Both cover medical expenses for doctor’s visits, X-rays, nursing services, funeral bills for survivors and more.
Also, there are overlaps in coverages between full and broad form insurance. Both have liability policies to cover injuries and repair costs other drivers get from an accident. Uninsured motorist protection (UM) is an extra that you can add to your broad form insurance. It comes with full coverage by default. With UM, if the accident was caused by an uninsured driver, your insurance will pay for the repairs to your car and your medical bills.
Most importantly, full coverage allows you to have more than one driver on the policy. Even though the cost of your insurance is higher than with broad form insurance, you’ll likely have less out-of-pocket costs.
Here are the six standard types of car insurance coverage:
Along with the six types of coverage, here are some additional services you can buy:
- Emergency roadside assistance will fix a flat tire (if you have a spare), jump-start a dead battery, tow your car to the nearest repair shop, help you get back into your car if you get locked out, and give you a gallon of gas if you run out.
- You can get your rental car costs reimbursed if your car needs to be fixed because of a valid claim. This covers your travel costs while you wait for your car to be fixed. It includes public transportation and rental car expenses. It won’t cover tolls, gasoline or a security deposit.
- Gap insurance: If your car is totaled in an accident, your insurance company will pay the actual cash value of your car. Gap insurance pays the difference between that amount and the amount you still owe on your car loan or lease. This keeps you from having to pay the full amount out of your own pocket to meet your financing agreement.
What Is Broad Form Homeowner’s Insurance Coverage?
FAQ
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